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Thank you!. General Session: Bill Bishop of Willard Bishop Consulting Drew Schwartzhoff, Director of Marketing at C.H. Robinson Tony Stallone, Vice President.

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Presentation on theme: "Thank you!. General Session: Bill Bishop of Willard Bishop Consulting Drew Schwartzhoff, Director of Marketing at C.H. Robinson Tony Stallone, Vice President."— Presentation transcript:

1 Thank you!

2 General Session: Bill Bishop of Willard Bishop Consulting Drew Schwartzhoff, Director of Marketing at C.H. Robinson Tony Stallone, Vice President of Merchandising and Food Safety for Online Grocer Peapod at Peapod LLC

3 How Food Retailers are Engaging Shoppers with Digital Presented by Bill Bishop August 20, 2013

4 What We Believe Customers are rebalancing their shopping to do more online but not abandon the store and this is creating a need for retailers to offer more digital connections.

5 About the Surveys 45,000 Shoppers 10 Retail Banners

6 Top On Shopper Wish List “Time your digital circular to let me get the value.” “Save me some planning time.” Make it quicker to find items in the store.

7 Three Key Questions Why you need strong digital relationships? Where else do your customers search? How can you help customers plan their shopping?


9 NEXT STEPS Get your customers’ reactions Identify and fix vulnerabilities Take advantage of competitors’ vulnerabilities

10 Are Shoppers Engaging?

11 What you can do: Find out what your shoppers want, but isn’t available on your site. Ensure the site is mobile friendly. Look for partnerships.


13 NEXT STEPS Find out more about why Decide if you want to provide it Look for partnerships

14 Are Shoppers Engaging?

15 What you can do: Make sure your emails are mobile friendly. Find ways to increase open rates. Be sure that the timing of your emails is right for your customers.

16 Are Shoppers Engaging?

17 What you can do: Use it for feedback if you’re ready to act on the feedback. Alert shoppers to events and promotions. Make it an integral part of your customer service.


19 NEXT STEPS Start to think like an online retailer Make it easier to build lists Highlight promotions on what they buy

20 Are Shoppers Engaging?

21 Online Retailers Where Produce is the Lead

22 What you can do: Put more emphasis on requests for items. Determine if there are services available to offer your customers online ordering. Evaluate offering your own online ordering service for stop pickup.

23 Keep Up with What’s Happening You can turn to Brick Meets Click to always get clear, commercial-free guidance on how digital is impacting the shopping experience and what you can do to build your business. Bill Bishop Chief Architect Brick Meets Click

24 How Consumer Opinion Leaders Think about Online Produce Purchasing Drew Schwartzhoff Director of Marketing August 19, 2013

25 C.H. Robinson in Retail & Produce 25 Global 3PL leader – 10+ million shipments handled annually – 45%+ of these shipments are in the retail/food & beverage vertical 100+ years of fresh produce experience – Leading Producer, Marketer and Distributor – 500+ Million cases sold over the last 5 years – Wide range of products and brands Fortune 300 company – Publicly owned and traded on NASDAQ (Symbol: CHRW)

26 Yesterday’s Supply Chain is linear

27 Today’s Supply Chain is More Complex

28 28 Online Produce Headlines Vary

29 Background – Objective – Methodology – Panel Composition – Today’s Results 29 CHR Consumer Opinion Leaders Panel

30 About half of all consumer opinion leaders have purchased groceries online 30 52.9% Groceries 92.2% Clothing 90.2% Books/CD/DVDs 47.1% Flowers 45.1% Pet Supplies Respondents Purchasing Category Online

31 No more than a quarter have tried any one type of online grocery service Delivered to homePickup at local storePick-up at separate facility 31 Same Day: 11.8% Next Day: 24.5% Tried Online Grocery Service Type Same Day: 2.0% Next Day: 2.0% Same Day: 8.1% Next Day: 9.8%

32 Most opinion leaders who try online do not stick with it 32 Delivered to homePickup at local storePick-up at separate facility Same Day: 4.9% Next Day: 3.9% Same Day: 1.0% Next Day: 0.0% Same Day: 3.9% Next Day: 2.9% Still Using Online Grocery Service Type

33 Nevertheless, many consumer opinion leaders remain intrigued with the idea 33 Finds Online Grocery Service Type Very Appealing/Appealing Delivered to homePickup at local storePick-up at separate facility Same Day: 69.6% Next Day: 52.9% Same Day: 61.4% Next Day: 52.9% Same Day: 53.0% Next Day: 43.1%

34 Opinion leaders think retailers can do the best job running EVERY service type 34 Company specializing in selling online A different retail store My current retail store Delivered to home21.17.071.8 Pick-up at local store10.914.574.5 Pick-up at separate facility12.727.060.3 What Online Grocery Service Type They Expect Will Do Best Job

35 About a quarter of opinion leaders have purchased produce online Quality & Freshness is executed well online Price value is still a disadvantage for online produce Items most often ordered: – Apples – Oranges – Full-sized Tomatoes – Bell Peppers 35

36 For produce shopping, in-store advantaged in some but not all areas 36 Shopping in-store better Freshness Quality Deals, discounts and promotions Finding what I need Wide variety Shopping/online about the same Brands I prefer Everyday prices Customer service Shopping Online better Overall convenience Speed Hard to find items

37 Opinion leaders attitudes paint a complicated picture On one hand… Most like going to the store: 69.8% agree “I personally don’t mind going to the store to do my grocery shopping…it’s something I actually enjoy doing.” Most are nervous about buying produce online: 71.6% agree “Of all the different groceries I purchase, fresh produce is among those that I am most nervous about purchasing through an online grocery service” …but on the other hand… Most are open to letting others select produce for them: 53.2% indicated they are potentially open to having someone else “selecting my produce items in the store.” Most believe an online service is capable of doing a good job on freshness and quality: 53.9% agree with the statement “If you go with the right online grocery service, you can feel confident they will bring you produce that is fresh and high quality.” 37

38 38 Emphasize New Benefits 82.4% a wider variety; specialty items 75.5% more local produce 68.6% more complete line of organics How to make consumers feel more positive Access to:

39 How to make consumers feel more positive 39 Offer Innovations 89.2% Product is delivered in temperature-controlled packaging and kept separate from other groceries 88.2% Comes with a 100% customer satisfaction guarantee 89.2% Carries a “daily freshness rating” so you know quality before ordering 89.2% Offering a strong quality and freshness guarantee

40 Change is Happening Fast! Your Supply Chain and your customers supply chain is changing - - and faster than ever before Your consumers buying behaviors are changing in how they purchase goods Are you doing enough to stay ahead of this change? 40

41 41 Produce Competing in a Digital World Tony Stallone VP, Merchandising and Food Safety, Peapod

42 Digital Produce World Agenda How it all started Reasons to be excited about online grocery/produce sales Who is Peapod and the other online players? Online produce facts you should know How to grow produce sales in the digital world Obstacles to growing produce sales Proprietary & Confidential 42

43 How It All Started The brothers: Proprietary & Confidential 43

44 How It All Started Mom knows best? or Proprietary & Confidential 44

45 How It All Started Mom knows best? 45 Proprietary & Confidential

46 Reasons to be Excited about Online Grocery & Produce Sales 46

47 Online Is Big Business Today Proprietary & Confidential 47

48 Grocery is different than other Internet retail You buy a lot of unrelated stuff... Proprietary & Confidential 48

49 Online Grocery Projected Growth 2% Percentage of total U.S. consumer packaged food sales purchased from online grocers in 2012 $6 billion Revenue generated by online grocery sales in 2012 $9.4 billion Predicted revenue in 2017, on an estimated 9.5 percent growth 1,620 Number of online grocery businesses in 2012 8.8% Market share of largest online grocer Peapod, followed by Fresh Direct with 5.7 percent Source: IBISWorld Proprietary & Confidential 49

50 Who is Peapod and the Other Online Players? 50

51 Peapod Today #52 in U.S. Internet Retailer’s Top 500 The #1 U.S. online grocer (local delivery) Proprietary & Confidential 51

52 Online is not a single commercial channel Staples and stockables Weak in perishables National ShipHome DeliveryIn-Store Pickup Closest to ‘online supermarket’ Perishables most developed Least common Easiest to establish Common first step * Testco online is a billion dollar business in UK* Proprietary & Confidential 52

53 Online Produce Facts You Should Know 53

54 How do Online Customers Behave? Buys more produce than in the store; more organics Order larger baskets $160+ They are brand loyal, often refer to previous orders during ordering process Order today for tomorrow, time starved Proprietary & Confidential 54

55 Produce Metrics Produce 2012 Metrics  92% of orders have a produce item  Almost 700 unique SKUs Data from Chicago Market 2012 Proprietary & Confidential 55

56 Produce Top Sellers at Peapod Produce Items Make Up Top Sellers Data from Chicago Market 2012 Proprietary & Confidential 56

57 Produce Organic Growth Organic produce sales continue to grow and in 2012 made up almost 23% of all produce sales Data from Chicago Market 2007-2012 Proprietary & Confidential 57

58 How to Grow Produce Sales in the Digital World 58

59 Produce E-Commerce Implications for Produce companies –Customers cannot feel, touch or smell produce. –No displays. –How do we promote effectively? –How do we build sales? –How do we help online consumers make decisions? How to work with E-retailers? Proprietary & Confidential 59

60 Co-Purchased Items in Basket Online allows for complete history of purchases, can determine categories that are co-purchased with other categories. Tomato example: lettuce, cucumbers and onions are more likely to be purchased with tomatoes. Barilla Pasta discovered that cucumbers and tomatoes were likely purchased with different shape pasta’s during the summer for pasta salads. E-Coupons work great in the online channel, pairing produce with affinity products. Produce is the Gateway to sales for CPG companies, because it is so often co-purchased. Over 90% of orders online contain produce. Proprietary & Confidential 60

61 Creating Meal Idea Bundles A coupon was created to buy one of each of Tomatoes on the Vine at $3.99, Ovalini Fresh Mozzarella at $3.99, and Organic Basil at $2.99, and receive the Basil FREE Sales increased on Tomatoes by 98%, Basil by 323%, and Ovalini by a whopping 530% Produce companies can leverage CPG’s to help create additional produce sales Proprietary & Confidential 61

62 How to grow produce sales in the digital world 62

63 Online Grocery Apprehension Source: Nielsen Homescan Survey (UK) Proprietary & Confidential 63

64 Best Practices Source: Nielsen Homescan Survey (UK) Proprietary & Confidential 64

65 Tesco Product Life Feature Tesco: “Because you can't see our products for yourself, we've given some items a 'Product Life' logo to help. This will show you how long the product is likely to be at its best when it arrives at your door. But that's not to say all your products will 'go off' straight after, it just helps you to plan your meals.” Proprietary & Confidential 65

66 Produce Tips Proprietary & Confidential 66

67 Philadelphia Interactive Transit Advertising Where is Produce? Proprietary & Confidential 67

68 Questions? 68

69 Please join us for lunch in the Exhibit Hall at 11:30am

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